Ciclon gets venture funds of $12 million

Bethlehem company is first tenant in new Ben Franklin Technology Partners incubator space.

March 07, 2007|By Jeanne Bonner Of The Morning Call

Ciclon Semiconductor Device Corp. of Bethlehem has raised an additional $12 million in venture capital funding that it will use to build a laboratory and complete work on a new product.

Guggenheim Venture Partners, which has offices in New York and Philadelphia, provided the majority of the money in this round. Ciclon also received investments from TL Ventures and Venrock Associates, which contributed money to a previous round that also raised $12 million for the company. Ciclon declined to specify how much each venture firm contributed in this round.

The company, pronounced "see-clone," makes chips used in base stations that sit at the feet of cell phone towers. The cooling effect of the chips helps lower power consumption and hence costs for customers. It was founded in 2005 by Mark Granahan, a former executive at Agere Systems who bought a small division from the Hanover Township, Lehigh County, chipmaker.

"The products and technology Ciclon has developed uniquely address the publicized energy challenges for high-density information technology well into the next decade," said Michael Burns of Guggenheim in a news release.

Ciclon, which employs 31 people, will use the infusion of cash to continue development of a new low-power chip that Granahan declined to characterize. It will also use the money to build a failure analysis lab, he said in an interview. The company uses contract manufacturers to process and assemble the chips.

Ciclon recently moved into a 14,000-square-foot space that's part of a new center in Bethlehem for startup firms and companies that have graduated beyond the initial startup stage.

Ben Franklin Technology Partners, which provides loans and inexpensive office space to startup companies, bought the building from Lehigh University because it ran out of room in its business incubator in Bethlehem, and because of a lack of space for incubator graduates. The city of Bethlehem is applying for a grant to help defray the cost of renovations in the building.

Ciclon, which is the anchor tenant in the new building, has received $150,000 in loans from Ben Franklin.

Ciclon is one of a handful of small tech firms in the Valley that have been launched by former Agere executives or that use technology developed by the company. Others include CyOptics of Upper Macungie Township, which bought Agere's former fiber-optic components business.

TL Ventures, based in Wayne, Delaware County, has invested in several tech companies based in the Lehigh Valley, including Circadiant Systems and Apogee Photonics.

Venrock was founded in 1969 as the venture capital arm of the Rockefeller family. The company has invested in Infinera, a maker of components for fiber optic networks that has a manufacturing facility in Upper Macungie Township. Venrock has offices in New York and Silicon Valley, Calif.